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Current Attempt in Progress At the end of her first year of university, Dorothy Taylor decided that she should start a business to help finance
Current Attempt in Progress
At the end of her first year of university, Dorothy Taylor decided that she should start a business to help finance her education, so she
set up her own courier service. She invested savings of $ in the company, which she called Sandhill Ltd In addition, her parents
lent the company $ to help it get started. Since this was a business venture, Dorothy insisted on paying interest on this loan, and
her parents agreed to charge a rate of per year.
Dorothy then negotiated the purchase of a used cat for the business for $ The company made a down payment of $ on the
car and financed the remainder of the purchase price at an interest rate of per year. Due to all of the kilometres that would be put
on the car while it was used in the courier business, Dorothy estimated that the car could be sold at the end of the summer for $
Sandhill began operations on May and continued until August Although Dorothy did not keep any formal accounting records, at
the end of the summer she put together the following additional information related to the business:
During the summer, the company made payments of $ on the car, which included interest of $ and principal of $
No payments of either interest or principal were made on the loan from her parents.
Dorothy paid herself a salary of $ per month for the four months that the business operated.
Payments for other operating costs including advertising, insurance, and gas totalled $ In addition, there were unpaid
bills totalling $ at the end of August.
Courier charges collected from customers totalled $ In addition, customers still owed $ for services performed in
the last two weeks of August.
After the close of business on August there was a balance of $ in the company's bank account, plus a "float" of $ in
the car.
Prepare a statement of income for Sandhill for the fourmonth period ending on August Enter loss using either a negative sign
preceding the number eg or parentheses eg
Sandhill Ltd
Statement of Income
For the Four Months Ended August XXX
Wages Expense
Wages Expense
Operating Expenses
Interest Expense Car Loan
Depreciation Expense
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